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Mexican gov't, tortilla makers trade blame over possible price hike

Jan 03, 2018 (Agencia EFE via COMTEX) --

Mexico City, Jan 3 (efe-epa).- Tortilla makers and the Mexican government are trading blame over a potential rise in the price of that basic food item, with the former saying rising energy costs are to blame and the latter warning about possible uncompetitive practices.

The National Union of Corn Mills and Tortillerias (Unimtac), which represents around 80,000 tortilla bakeries and mills nationwide, says the price of that basic foodstuff for millions of low-income Mexicans could rise by between 1.5 pesos and three pesos (between $0.07 and $0.14) per kilogram.

The price per kilo at tortilla bakeries ranges at present from between 9.33 pesos ($0.50) in the central city of Puebla to 19.83 pesos in the northwestern city of Hermosillo, according to the Economy Secretariat's National Market Integration and Information System.

The Unimtac said Wednesday that the price of tortillas will rise nationally due to changes in international corn markets and a significant rice in the prices of natural gas, gasoline and electricity.

That organization's president, Lorenzo Mejia, therefore called on authorities to create a national commission to analyze the chain of production for corn and tortillas.

But his remarks prompted an immediate response from the Economy Secretariat and Mexico's consumer protection agency (Profeco).

"Today's statement about the increase in the price of tortillas is groundless since the price per ton of white corn at the start of 2018 is 11 percent lower than its price a year ago," the secretariat said in a bulletin, noting that white corn "is the main component of the cost of a kilogram of tortilla."

It added that the government was ready to use all instruments at its disposal to curb unjustified increases in the price of this product.

For his part, the president of the National Confederation of Maize Producers in Mexico, Juan Pablo Rojas Perez, accused industrialists, mill operators and tortilla bakeries of importing yellow corn for tortilla production even though that practice is not allowed under current law.

He said an increase in the price of that foodstuff was unjustified because the cost of Mexican white corn has held steady at a range of between three and 3.8 pesos ($0.15 and $0.20) per kilogram.

While Mexico is self-sufficient in white corn, which is mainly destined for human consumption, each year it imports around 14 million tons of yellow corn (95 percent from the United States) at a cost of $2.5 billion.

Yellow corn is mainly used in Mexico for livestock feed.

The cost per kilo of tortilla has risen more than 60 percent over the past decade, and concerns about a rise in the price of this basic foodstuff therefore traditionally spring up at the start of a new year.

Those concerns were particularly heightened in January 2017, when the government's move to phase out fuel subsidies - and thus allow gasoline prices to soar by between 14 percent and 20 percent - touched off a wave of criticism and protests.

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